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PRODID:-//Indira Gandhi Institute of Development Research - ECPv4.1.2//NONSGML v1.0//EN
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X-WR-CALNAME:Indira Gandhi Institute of Development Research
X-ORIGINAL-URL:http://www.igidr.ac.in
X-WR-CALDESC:Events for Indira Gandhi Institute of Development Research
BEGIN:VEVENT
DTSTART;TZID=Asia/Kolkata:20240904T161500
DTEND;TZID=Asia/Kolkata:20240904T173000
DTSTAMP:20260429T100351
CREATED:20240827T113718
LAST-MODIFIED:20240827T113848
UID:18941-1725466500-1725471000@www.igidr.ac.in
SUMMARY:IGIDR Seminar: "Real Effects of Bank Shocks"
DESCRIPTION:\nAbstract:-\nWhat are the effects of bank shocks in an economy featuring bank-firm lending relation-\nships and what is the propagation mechanism? This paper builds a dynamic general equi-\nlibrium model in which collateral-constrained entrepreneurs have endogenously-persistent\n\ncredit relationships with banks. A bank shock in this model takes the form of a negative\nshock to loan repayments and drives up credit spread. Bank credit falls and a downturn in\nmacroeconomic activity ensues. These effects are initially amplified by presence of lending\nrelationships but macroeconomic activity later recovers faster boosted by recovery in bank\nloans. When credit relationships are turned off\, the model predicts prolonged slowdown in\n\ninvestment\, consumption and output. These results indicate how borrower-lender relation-\nships can act both as financial accelerator and as an economic stabilizer. 
URL:http://www.igidr.ac.in/seminars/igidr-seminar-real-effects-bank-shocks/
CATEGORIES:Seminars,Upcoming events
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